127. Telegram From the Department of State to the Embassy in the Congo1

539. Embtel 823.2 Department agrees with Embassy views expressed paras 5 and 6 section 2 reftel3 and hopes negotiations proposed agreement can start soonest. Re Embtel 8144 official French translation should have reached Léopoldville September 26.

Objections expressed by Khiari on bilateral approach are understandable. Dept also has been concerned over possible political consequences using this approach.

Dept continues favor channeling aid to Congo through UN in order bolster UNOC and prevent subversive operations under guise aid programs. However must recognize UN Secretariat will eventually reduce its role in Congo aid program and has specifically suggested US negotiate bilateral PL 480 agreement to avoid becoming involved directly in such agreement on behalf of Congo. Formula worked out for 90% local currency proceeds to be used by UN financed projects in Congo was specifically designed to serve as possible pattern to permit UN control of bilateral aid programs.

Appropriate publicity should bring out UN role and sponsorship.

At present UN is administering Congo aid as far as it receives contributions in UN Congo Fund and coordinating foreign aid as far as bilateral programs exist (e.g. US scholarship and educational programs) approved by UN.

If UN/HQ should at some future date decide no longer desirable for UN to administer and coordinate aid, possible that UNOC Léopoldville might assume coordination all direct (bilateral) aid which [Page 245] is expected replace present UN Congo Fund. If this not attainable presence UN advisers in key positions in GOC, particularly UN expert as head of Monetary Council, might permit establishment satisfactory machinery to coordinate and control foreign aid to Congo. This could be done by establishing committee preferably responsible directly to Prime Minister with powers to coordinate and control all foreign aid to Congo. Committee should be headed by UN or Western expert cooperating closely Monetary Council as well as body that might be created administer external budget aid.

Therefore (1) US aid to continue be given through UN channel (with PL 480 somewhat exceptional arrangements as now envisaged) as long as UN willing play active role administering Congo aid funds and does so in way satisfactory to US; (2) in order to prepare, in advance of eventual phasing out direct UN role in Congo aid, for satisfactory coordination aid to Congo under as strong UN or Western influence as obtainable and to assure increasing participation by Congolese personnel in UN aid activities, US to encourage creation machinery within GOC under control Prime Minister and directed or assisted by experts from countries friendly to West but staffed mainly by Congolese which could eventually assure satisfactory coordination foreign aid granted to Congo directly by various aid givers. This body would take charge of coordination when UN moves toward phasing out coordination aid to Congo; IMF to be requested (by UN, GOC with US support) play active though advisory role in working out and facilitating implementation program for financing aid needs Congo as long as stabilization program may be necessary, and IBRD for longer range economic development needs.

Would appreciate Embassy’s views best way to implement policy outlined preceding paragraph. Suggest you discuss also with UNOC.

  1. Source: Department of State, Central Files, 611.70G41/9–2961. Confidential. Drafted by Robert C. Huffman of the Office of Central African Affairs and by Eisenberg; cleared by Assistant Secretary for Economic Affairs Edwin M. Martin, Deputy Director of the Office of International Administration Frank K. Hefner, Buffum, and with the ICA; and approved by Ball. Repeated to USUN, Brussels, London, and Paris.
  2. In telegram 823, September 25, Gullion reported a conversation the previous day with Khiary, who had expressed disapproval of a proposed U.S.-Congo agreement to extend P.L. 480 assistance to the Congo on the ground that it would set a precedent for bilateral aid agreements and would open the way for Soviet bloc offers of bilateral aid. Gullion pointed out to Khiary that the form of the proposed agreement had been suggested by U.N. headquarters. (Ibid., 611.70G41/9–2561)
  3. These paragraphs commented that Gullion thought a bilateral agreement would bolster the Adoula government and that he questioned whether the Adoula government would refrain from entering into bilateral aid agreements even if the United States adhered to the multilateral formula as Khiary proposed.
  4. Dated September 23. (Department of State, Central Files, 611.70G41/9–2361)